Solana, a Layer 1 blockchain designed to ease the establishment of new decentralized apps and smart contracts is showcasing an incredible performance in the past month.
This turnaround comes after an incredibly bad year for the blockchain. In fact, Solana even appeared in our end-of-the-year article regarding the worst-performing cryptocurrencies in 2022.
Fall of Solana Token
During that year, the once thought ‘Ethereum rival‘ dropped from $177,89 to less than $9,00, amassing a 94% loss in 2022.
The previous year had been filled with turmoil for the layer-1 blockchain.
During that time, $SOL dealt with several technical problems, some even causing the blockchain to completely shut down for hours on end.
In addition, Solana also saw its most popular NFT companies leaving the blockchain in order to go to Polygon.
On top of all that, the cryptocurrency brand also had a close relationship with the disgraced crypto exchange FTX. Reports indicate that the Solana Foundation even had millions invested in SBF’s companies.
That sequence of events might have led the world to believe that SOL was in fact on its way out the door. In December, the “Sunshine‘ coin reached its lowest point in years, trading at around $8,29.
However, in 2023, Solana is showing the cryptocurrency market that the blockchain is not done yet.
Since mid-December, the SOL token grew by a whopping 89%, going from $8,28 on December 29 to $17,19 on January 9.
What Caused $SOL To Bounce Back?
Solana’s resurgence comes as a result of several different aspects. For starters, the entire cryptocurrency market is showing signs of a reversal after the Federal Reserve begins to indicate a deceleration of interest raises.
In addition, the projects launched on the platform, particularly the meme coin Bonk Inu (BONK) also caused a positive impact on the price of the SOL token.
The currency, which has the same characteristics as other cryptocurrencies like Dogecoin and Shiba Inu, emerged at the beginning of the year as part of an airdrop (free token distribution event).
$SOL token’s daily active users climbed by more than 40% in the previous two weeks, climbing from 300 million in December to 525 million today, according to data from the on-chain tracker Artemis.
